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HealthAlliance forced to return $226G in unspent grant funds

By Michael Hartwell, mhartwell@sentinelandenterprise.com

Updated:
08/12/2013 06:30:36 AM EDT

FITCHBURG -- HealthAlliance Hospital of Leominster and Fitchburg was forced to return $226,000 in state grant money after failing to spend it in the allotted time, but a hospital spokesperson said the unspent money reflects a cost-savings success.

On July 22, Scott J. Martin, the hospital's director of public safety and emergency management, received a letter from the Massachusetts Department of Public Health requesting the return of unspent portions of emergency-equipment grants from the past six years.

Going back to 2007, the hospital had received $398,177 in grants from the Office of the Assistant Secretary for Preparedness and Response, or ASPR grants. The Massachusetts Department of Public Health channels those grants to hospitals through the Hospital Preparedness Program.

The money is supposed to be spent on preparations for emergencies like massive accidents, acts of terrorism and pandemics. Specific costs include conducting mass causality drills to respond to a situation like the Boston Marathon Bombing, integrating emergency responses with local police and fire departments, and purchasing supplies for emergencies scenarios like materials to treat blast victims and devices to move patients down hospital staircases when elevators cannot be used.

The grant money is supposed to be spent in the year it is given, but a site visit to HealthAlliance Hospital on April 12 showed $226,060, which is more than half of the ASPR grant money the hospital had received, had not been spent.

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For example, in fiscal 2007 the hospital received $66,883 and spent $41,755 on emergency preparations, leaving $25,127 of unspent state money in the hospital's possession. In fiscal 2011, the hospital received $58,500 but only spent $11,188. The hospital received ASPR grants every year since 2007, and each year had at least $21,000 of that year's money left over.

The letter from the Massachusetts Department of Public Health stated: "Overall HealthAlliance Hospital maintains fairly detailed financial records but lacks institution control and understanding of the contract terms and guidelines. There seemed to be a misunderstanding of rules and reporting associated with the individual years of funding."

The letter requested the hospital return the $226,000 in unspent money to the Massachusetts Department of Public Health by Aug. 12. Veronica L. Rosa, the hospital's corporate vice president of external affairs and marketing, said that money has already been returned.

"In the case of grants like this, it is our policy to return funding which isn't needed," said Rosa. "In this case, the state notified us before we could return the funding and we did so immediately. This effort is a benefit to our community; the money was well-spent and effectively managed at all times."

She said the hospital is fully prepared to manage any crisis facing the community, including acts of terrorism.

"As a result of our planning, preparation and focus on safety, we were able to utilize the emergency preparedness grant dollars efficiently and effectively without exhausting the entire allocation of funds," Rosa said. "We have spent the grant dollars appropriately and in accordance with the grant provisions while gaining efficiencies throughout the process.

For example, Rosa said, the hospital received grant money for a microscope that identifies airborne pathogens, but opted not to buy one because the hospital already possessed a similar device.

She also said the hospital conducts annual mass-casualty drills with local fire departments, ambulance companies and emergency management services for scenarios like a nursing home evacuation, ongoing mass shooting and an evacuation of the hospital itself.

"Due to our routine preparation and planning, these drills cost HealthAlliance approximately half the allocated cost," she said.

Rosa said the hospital carefully monitors its spending, and the money was spent wisely and appropriately.

There is no penalty or punishment, as the money was appropriately allocated for intended objectives, although the time frames in which the funds were required to be spent were not met.

It is not clear if the hospital will be able to apply for ASPR grants next year.

The letter concluded by saying: "Future funding will depend on adherence to an agreed-upon management and reporting plan."

A spokesperson for the Massachusetts Department of Public Health could not provide further information on the ruling.

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